(Yicai Global) March 1 -- Shares of Country Garden Holdings surged after one of China's largest property developers by sales said founder and Chairman Yang Guoqiang has stepped down and will be succeeded by his daughter Yang Huiyan.
Country Garden [HKG: 2007] soared 8.3 percent to close at the day’s trading high of HKD2.60 (33 US cents) a share.
Yang Guoqiang, 67, resigned because of his age and Yang Huiyan was named to the chairmanship effective immediately, the Foshan-based developer said in a filing to the Hong Kong stock exchange today. He will remain at the firm as a special consultant.
Yang Guoqiang was one of the first entrepreneurs in China’s property sector and set up Country Garden in 1992. The firm succeeded big by using a low margin-quick turnover strategy in its early days, attracting swathes of buyers to its affordable villas on the outskirts of cities.
The ex-chairman had prepared Yang Huiyan for the top job by taking her to internal meetings since her teens. She joined Country Garden after graduating from university and has held many positions in the company, including head of the purchasing department, executive director, vice chairperson, and co-chair.
Country Garden's board of directors speaks highly of Yang Huiyan, and the succession comes as no surprise, a company insider noted.
How she deals with the challenges posed by China’s real estate market will be closely watched. While serving as an executive director, she promoted the listings of units Bright Scholar Education Holdings and Country Garden Services Holdings. In particular, the latter's share floatation and stock performance were positively received by the market.
When Country Garden itself went public in 20007, Yang Huiyan became China's youngest female billionaire at the age of 28 thanks to her stake in the firm, owned on behalf of her family.
Country Garden ranked first among developers with sales of over CNY550 billion (USD79.6 billion) in 2007. The homebuilder regained the top spot in 2017 after losing it in 2012. But in the first two months of this year, the firm was pushed into third place with CNY56.2 billion, behind state-owned Poly Developments and Holdings Group in first with CNY63.5 billion and China Vanke in second.
Most of the real estate giants that formed in China about the same time as Country Garden had a debt crisis last year, but Country Garden was one of the few private businesses to avoid a credit rating downgrade.
Editors: Shi Yi, Martin Kadiev